What is financial abuse?

Financial abuse is a form of family violence. It can include withholding money, controlling all the household spending or refusing to include you in financial decisions. Financial abuse can happen to anyone.

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When we got married I had some savings, a job and a car. The marriage is over and I’ve got nothing.

Sound familiar?

Unfortunately, many people do not have access to finances in their relationship. Should the relationship break down, they often find themselves without any money, or may not even know how much money they are entitled to.

What defines financial abuse?

The law in Victoria states that financial abuse is a form of family violence. Family violence occurs when one person exerts power and control over another. Family violence is a repeated pattern of behaviour, and can occur between partners or other family members. Many people think of family violence as either physical injury or emotional abuse. However, withholding money, controlling all the household spending or refusing to include you in financial decisions can be defined as family violence. Financial abuse can be present with other forms of abuse, like physical or emotional abuse, but can also be present without these other behaviours.

Financially abusive behaviours include:

Controlling a family member’s money:

Taking control of someone else’s finances (e.g. being in charge of all the household income and paying the other person an allowance).

Controlling how all of the household income is spent.

Forcing a family member to claim social security benefits like Centrelink.

Making a family member go guarantor on a loan or take a loan out in their name.

Making a family member take out a second credit card.

Forcing a family member to work in a family business without being paid.

Filing fraudulent insurance claims.

Forging a family member’s signature on financial documents.

Taking money out of a family member’s pension.

Selling a family member’s possessions without permission.

Misusing an Enduring Power of Attorney.

Forcing a family member to change their will.

Stopping a family member from earning their own money:

Stopping a family member from getting a job or going to work.

Stopping a family member from going to work or important meetings by keeping them up all night or physically hurting them.

Stopping a family member from studying.

Stalking or harassing a family member’s colleagues.

Limiting a family member’s access to money:

Not giving a family member access to bank accounts.

Denying a family member access to money so they can’t afford basic expenses like food or medicine.

Destroying, damaging or stealing property.

Racking up debt on shared accounts or joint credit cards.

Withholding financial support like child support payments.

Refusing to work or contribute anything to the household income.

Gambling away a family member’s money or shared money.

Who can experience financial abuse?

Anyone can experience financial abuse, irrespective of their socio-economic, ethnic or cultural backgrounds. . Financial abuse commonly occurs in romantic relationships. It can happen during the relationship, or may begin after separation through things like property settlement and child support processes. It can happen in heterosexual or same sex relationships, whether or not you are in a monogamous or poly relationship and regardless of whether or not you have children. It can also occur when you are not living in the relationship any longer.

Financial abuse can also occur in other family relationships. This can be between parents and children, between relatives or in any family-like relationship such as with carers and housemates. Although it can happen to anyone, the vast majority of violence is perpetrated by men against women.

Financial abuse of an older person is also a form of family violence called elder abuse. It is most commonly perpetrated by the older person’s adult child, and can occur with or without other forms of abuse. Financial abuse, along with emotional abuse, is one of the most common forms of family violence perpetrated against older people, with both forms of abuse often coexisting.

Many people feel responsible for the financial abuse they have experienced. It is important to know that financial abuse is perpetrated by people who use power and control against you. It can happen to anyone, regardless of their financial ability or knowledge.

You are not to blame. Whatever your circumstance, support and resources are available to help you regain control of your finances.

Where can I go for help?

If reading this article has raised issues for you, you can contact WIRE at any time between 9am and 5pm, Monday to Friday.

Dowry-related violence

Dowry is giving of money or goods to a bridegroom or his family in exchange for the promise of marriage. It is a practice which, whether combined with arranged marriage or not, maintains gender inequality. The dowry practice is regarded as a significant contributing factor to violence against women, ranging from emotional and physical abuse to financial abuse.

Australians from many different cultural backgrounds practice dowry arrangements. A woman’s diminished financial capacity to leave a relationship can be exacerbated by fear, social isolation, cultural expectation, language barriers, unfamiliarity with support services and uncertainty around visa status.

The Victorian Royal Commission into Family Violence has recommended that the Victorian Government include forced marriage and dowry-related abuse in the legal definition of family violence.

Realities of ‘relationship debt’

Sometimes the debts you are left with due to financial abuse are referred to as ‘sexually transmitted debt’ or ‘relationship debt’. Relationship debt is common and serious — it happens when you have to pay your partner’s, or ex-partner’s, debts. Your partner might have forced or tricked you into signing a loan contract as a co-borrower or guarantor, or signing a mortgage so they could obtain a loan.

The reality is that you can be held responsible for these debts. If your name is on the contract, then you as a co-borrower are responsible for repaying the loan. If you have more assets or earnings than your partner, or you are easier to find, it is likely you will be chased for payment. As a co-borrower, you may even find yourself solely responsible for a debt that you know nothing about. If you are experiencing relationship debt you can call the National Debt Helpline for free financial counselling.

How did you get here?

I loved him and trusted him with our money, now I’m left with all his debts.

Trust in a relationship

In a relationship when you are in love, you may find it easy to trust your partner with all your money matters. It can also be challenging to question your partner about money as you may feel you are questioning their love.

Myth: Handing over all responsibility and control of the household finances is a way of showing your partner trust, respect, love and commitment.

In reality:

Shared trust, respect, love and commitment in a relationship are reflected in having honest and equal power in all aspects of the relationship, including finances. If your partner truly trusts, respects and loves you, you should be able to have a choice about money matters and be part of the decision-making process.

Influence of your family and culture

In your family or culture, women might be excluded from financial matters and not encouraged to manage money

Socially, money is often seen as a private matter that is not discussed publicly, so you had no one to talk to

Your cultural beliefs might also lead you to think that it is acceptable for your partner to use money to control you

Myth: Men are traditionally heads of the household and are better at finances than women

In reality:

You don’t have to agree if your partner says you have poor money skills, or says you don’t deserve to learn about managing your finances. Women are great managers of household budgets, and every woman has a right to know about money.

If you are concerned that you might not have money management skills, think back to when you have successfully managed money in the past. A good example might be when you worked out the household budget or paid rent and bills.

Lost your confidence with money

I’m so scared of dealing with money I don’t even want to think about it.

If you have lost your confidence with managing money, you might simply not want to know about it. Or you may feel overwhelmed and find it hard to take the first step. Many women in similar situations feel this way. However, it is important to take steps in learning how to manage your finances. Not doing so may disadvantage you and your family down the track.

When the penny drops

For many women, it can be hard to recognise that they are experiencing financial abuse in a relationship. However, something might tip you over the line – another bill, discovery of your partner’s hidden assets, or an article that you’ve read. You suddenly realise that you’ve been financially abused and that it is wrong.

When you realise the extent of your loss due to the abuse, you might feel angry and determined to get your share back. Navigating the legal and child support systems in Victoria can be frustrating, challenging and drawn out over a long period of time. You can call WIRE on 1300 134 130 for support about financial and legal issues any time from 9-5 on weekdays.